War, inflation and oil cap stocks rise again as yields warn

  • Oil $ 100 and stretching gains
  • Stock indices changed little
  • Biden-Xi phone call at 1300 GMT
  • Yield reversal

LONDON, March 18 (Reuters) – Global stock markets clung to their weekly gains on Friday, but were revived by rising interest rates, higher oil prices and a cocktail yield warning signal that there would be no end to the war in Ukraine. For the economy.

MSCI Global Stock Code (.MIWD00000PUS) It was up 5.4% for the week at 695 points, but was below its lifetime high of 761.21 since January 4th.

“Sentiment is still very cautious, it is looking for some reason to mobilize, but it is struggling to find something with strong confidence,” said Seema Shah, chief strategist at Primary Global Investors.

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In Europe, STOXX (.STOXX) The index of 600 leading companies changed slightly by 450 points, with its lifetime high 9% lower since the beginning of January.

Shaw said the US Federal Reserve was somewhat relieved to begin its series of interest rate hikes on Wednesday, and it is questionable how the economy will develop from here and how inflation will rise before the peak.

Oil prices have hovered above $ 100 a barrel following the slow progress of peace talks between Russia and Ukraine, raising fears of severe sanctions and a long-term disruption to crude supplies. read more

“I suspect the conflict will continue to boil over in the background, and you can see oil prices rising as a result,” Shaw said.

Along with the mix, US President Joe Biden is expected to issue a warning that Beijing will pay a price if he supports Russia’s war effort when he talks with Chinese President Xi Jinping at a scheduled call at 1300 GMT. read more

A first Russian external annexation mistake after the Bolshevik Revolution now seems to have been avoided. Sources say some lenders received Russian bond coupons in dollars to pay this week. read more

In Asia, MSCI is the broadest index of Asia-Pacific equities outside of Japan (.MIAPJ0000PUS) 0.15% lower and Hong Kong’s Hong Cheng remained stable for two days. Nikkei of Japan (.N225) 0.6% higher.

Michael Hewson, chief market analyst at CMC Markets, said the impact of port inflation and disruptions in supply chains in China due to an increase in COVID infections and risks largely unnoticed by markets. read more

“It’s a reversal of the ratings, and this time we’re getting a very decent recovery.

The S&P 500 futures are down 0.55%, with bigger data lower than Wall Street opening bell.

Yield reverse

Yield reverse warning

The problems facing policymakers affected by rising inflation and sluggish growth in the economies were underlined during this week’s central bank meeting.

The central bank on Wednesday raised rates for the first time in more than three years and surprised traders with more hawks than expected. Bank of England also rose. read more

The Bank of Japan provided no surprises on Friday, easing policy, which has put more pressure on the yen. read more

Meanwhile, the gap between two- and 10-year U.S. Treasury yields has been close to its tightening levels since March 2020, with economies collapsing since the start of the Govt locks.

The tight gap is not far from the reverse of the yield curve, which is a reliable indicator of a recession over the next one or two years.

Benchmark 10-year Treasury yield last stood at 2.1655%.

Oil, which has fallen by about 30% since last week’s peak, has risen sharply as traders regret that hopes for peace in Ukraine are misplaced. Brent crude futures last rose 1.3% to $ 108, adding more than $ 10 a barrel in two sessions.

“It is very difficult to have confidence that you can reliably get goods from Russia or Ukraine,” said Tobin Corey, inventory strategist at the Commonwealth Bank of Australia in Sydney. “You’ll go looking elsewhere. It’s going to be expensive.”

The futures for wheat and corn, which are sensitive to Black Sea supply disruptions, have risen sharply.

Japan’s currency was at 118.83 against the dollar this week, the lowest level in six years. “The next multi-session target could be a psychological level of 120.00,” said Terence Woo, a strategist at OCBC Bank in Singapore.

The euro was down 0.3% at $ 1.106

Spot gold was down 0.5% at $ 1,935 and Bitcoin was down 0.7% at over $ 40,000.

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Report by Hu Jones, Additional Report by Tom Westbrook, Edited by Sri Navaratnam, Simon Cameron-Moore and Angus Maxwan

Our standards: Thomson Reuters Trust Principles.

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